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A restaurant is for sale for $ 2 3 1 , 4 4 2 . It is estimated that the restaurant will earn $ 2

A restaurant is for sale for $231,442. It is estimated that the restaurant will earn $23,078 a year for the next 13 years. At the end of 13 years, it is estimated that the restaurant will sell for $467,681. Which of the following would be MOST LIKELY to occur if the investor's required rate of return is 12.2 percent?
Option 1: The NPV is equal to or greater than zero, and the investor would pursue the project.
Option 2: The NPV is less than zero, and the investor would not pursue the project.
Option 3: Investor would pursue the project if the holding period were longer than 13 years.
Option 4: Not enough information provided to answer the question.
Note: Enter the option number as your answer. IF a student's answer was Option 1, the student would enter the numerical number "1" as the answer: 1
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